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POLICY WATCH - PUBLIC PROCUREMENT POLICY AND E-AUCTION




INTRODUCTION

- The public procurement policy AIMS at incentivizing production linked through

local content requirements, thereby increasing domestic manufacturers

participation and public procurement activities over and entities merely important

to trade or assemble items.

- Various ministers and departments have been designated as nodal for define

minimum local content for the relevant product categories.

- The government has notified public procurement policy for micro and small

enterprises as well. Under this policy come on 25% of annual procurement by

central Ministries / departments / public sector enterprises has to be made from

micro and small enterprises.


INSIGHTS

- The target is for government departments, public sector undertaking and

autonomous bodies.

- Make in India public procurement ordered success could be gained, more than

15000 crore worth of tenders for cancelled at instance because of discriminatory

conditions prohibiting the local vendors to participate in tender.

- The Government of India through its various departments buys about 5 lakh crore

worth of goods and services every year, 25% of that is quite substantial. There are

20,000 sellers who are registered on a platform and selling about 50,000 products

and paperwork is eliminated, vendor registration being made simple.


Challenges that private entrepreneurs are facing on government E-marketplace:-

• It is difficult for small and medium companies to participate in tenders because they

have to meet certain criteria.

• Do they qualified to supply those quality products which are made mandatory, it’s a

policy that 25% material will be taken by small Enterprises.

- Medium enterprises for instance, its turnover should be below 250 crore. A large

number of companies can qualify and do qualified.


- To implement procurement policy of reservation in favor MSME there could be two

approaches:-

1. For every procurement order split the items which is not possible, certain

items can not be splited.

2. Certain orders can be placed on experimental basis for products which are

not successfully on the shelf.


- Procurement policy can help the startups in long way. But its not

that easy. Startups have to do competition with the big ships which is

a big challenge.

- Government has to make lot of criterias to ensure that all the

products they are buying from small entrepreneurs really meeting

all the parameters and quality standard.

- E-Auction – where human interface is minimum.

- Major policy Reform that has happened in the procurement area is

the introduction of moving away from L1 process.

- The department of financial services launched properties which

bank holds.

- There has to be full transparency for E -Auction for each property

(3500 properties have been listed on the portal) the bank has to do a

lot of work and also to provide everything upfront.

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